Gold outperforms ALL major stock markets in 2011

[swissaustrian]

Chart by Matterhorn Asset Management ( www.goldswitzerland.com ), a company which employs some friends of mine

Additionally, the long term Dow-gold ratio

 

[pmbug]

Another fun chart from finviz:

 

[ancona]

Interesting charts. I thought my silver had perfermed much better than that. I guess relative to world currencies, I have done well, with 35% bought at 9.60, 40% bought at 16 and change and the last of it at 22. I still buy a token ounce a week, just to remind myself that PM's are the only real money. I believe those of us who had the wisdom and foresight to purchase PM's while folks still had faith in fiat will b3e rewarded for our prudence.

 

[pmbug]

Silver did do much better than that. Prior to the end of May slaughter that is.

 

[Silver_Bug]

Another fun chart from finviz:

The 30 year bond had 50% higher return than gold!! What in carnations is going on?!!? I wouldnt have believed it.
What is the explanation for this?
I am truly baffled by this.

 

[swissaustrian]

The 30 year bond had 50% higher return than gold!! What in carnations is going on?!!? I wouldnt have believed it.
What is the explanation for this?
I am truly baffled by this.

I can name a few reasons for that:
1. operation twist. The FED is buying long term treasuries. Prices are not set by Mr Market.
2. Treasuries are clearly in the mania phase of the 30 year bull market which started in 1981. The whole yield curve is yielding negative real (inflation adjusted) returns. This is unsustainable. Interest rates have long term cycles of about 30 years (Read: Richard Homer - A History of Interest Rates; an excellent book), we are at the very end of the bull cycle. I´m short 10 years even if it might take a year or two until I make money on that trade.
3. Treasuries are accepted as collateral for loans in the interbank market as well as for FED funding. Money markets are desperately searching for collateralizable assets right now.

 

[Silver_Bug]

I can name a few reasons for that:
1. operation twist. The FED is buying long term treasuries. Prices are not set by Mr Market.
2. Treasuries are clearly in the mania phase of the 30 year bull market which started in 1981. The whole yield curve is yielding negative real (inflation adjusted) returns. This is unsustainable. Interest rates have long term cycles of about 30 years (Read: Richard Homer - A History of Interest Rates; an excellent book), we are at the very end of the bull cycle. I´m short 10 years even if it might take a year or two until I make money on that trade.
3. Treasuries are accepted as collateral for loans in the interbank market as well as for FED funding. Money markets are desperately searching for collateralizable assets right now.

thanks. good book by the way. i ll order it. the reviews are good.


still surprising as heck that the bonds did so good in 2011. it would have expected it to lag behind gold. we ll see at the end of 2012 if the long bonds will outperform again the precious metals.

i wonder if the crossing above the 100% debt/GDP ratio will have an impact here.